Peter Teirlinck

Formal R&D management and strategic decision making in small firms in knowledge‐intensive business services

Small research and development (R&D) active firms in knowledge-intensive business services (KIBS) can be characterised as technology experts in niche markets. Their reliance on expertise in one or a few key technology areas involves a continuous challenge to make strategic decisions in terms of future technology and market positioning. The formal management of R&D is considered an important part hereof. However, besides the fact that it is no common practice in about half of these companies, little is known about formal R&D management in small firms in KIBS. This paper addresses this gap using a combined quantitative and qualitative research approach. The starting point for the descriptive quantitative empirical analysis is a representative sample of small R&D active firms in KIBS provided by the Organisation for Economic Cooperation and Development business R&D survey for Belgium. The presence of formal R&D management is related to aspects of dynamic capabilities. The qualitative research is based on strategic choices in the innovation strategy in 12 purposively chosen small firms during the period 20052011. It maps the evolution of the firms technology and market positioning within a setting adapted to small firms in KIBS, and highlights its relation with formal R&D management. The analysis reveals that formal R&D management in small firms in KIBS can be related to more complex linkages between internal innovation strengths and opportunities in the firms external environment. Moreover, formal R&D management in KIBS is found to be closely related to dynamics in strategic decision making in terms of market positioning and to innovation success. The influence of formal R&D management on the technology focus in small firms in KIBS turned out to be of minor importance.

Dipping in the Policy Mix: Do R&D Subsidies Foster Behavioral Additionality Effects of R&D Tax Credits?

We analyze how behavioral additionality effects of wage-based R&D tax credits are influenced by the firms joint use of R&D subsidies. Using matching estimators and a multivariate probit analysis of cross-sectional survey data on Belgian firms, we find that R&D subsidies induce tax credit users to focus more strongly on research relative to development and to accelerate the execution of R&D projects. To a slightly lesser extent, we also find size effects, firms scaling up current R&D or initiating additional projects. Overall, these findings suggest that companies that benefit from the ‘policy mix’ respond more strongly to R&D tax credits and use the tax-exempted resources to adopt a more strategic approach to R&D.

Pathways for knowledge exchange in SMEs in software-driven knowledge-intensive business services: Pathways for knowledge exchange in SMEs

This paper presents pathways for knowledge exchange as regards innovation in R&D‐active SMEs in software‐driven knowledge‐intensive business services in a capital city environment. A semistructured qualitative analysis focusing at social capital enablers for knowledge exchange reveals that interpersonal social proximity is the primary driver for knowledge exchange. Structural enablers for knowledge exchange include accessibility for clients, geographical proximity to research partners, temporary places for formal and informal meetings, specialization and diversification in terms of human resources skills, and informal interpersonal networks. Market and government‐related goals, access to public funding and possibilities for lobbying, as well as openness to a multicultural environment, are all underlying cognitive factors. Relational social capital dimensions include organized trust in terms of neutral ground, goodwill trust‐based interpersonal weak ties, and mutually embedded businesses and processes with institutions.

Thanks, but No Thanks: Companies’ Response to R&D Tax Credits

This paper starts from the observation that the majority of firms in Belgium that were eligible for a newly introduced R&D tax credit system does not use it, or is slow to adopt, despite significant potential cost savings. We hypothesize that the R&D support landscape is complex for firms to navigate and that they may cope by relying on their peers’ behaviour to inform their own adoption decisions. We identify endogenous peer effects in industry- and location-based peer groups by exploiting the intransitivity in firms’ peer group networks as well the variation in peer group sizes. The results show that firms’ decisions to use R&D tax credits are indeed influenced by the choices of their peers, primarily in the time window following the introduction. Our analysis complements the literature on peer effects in firm decision making and suggests improvements for the communication of new public support measures for business R&D.

Managing Open Innovation

Open innovation is about firms’ external relations with other firms and organisations. It is a topic which has attracted an immense amount of attention, but which has also been heavily criticised due to the diversity of the ideas and fuzziness of its key concepts. To date, the bulk of the literature on open innovation draws on case study material to illustrate the operation of firms in an anecdotal way. By contrast, this book examines open innovation practices by using large-scale datasets and stresses their impact on firm performance. The authors examine four key issues: differences between firms in open innovation practices, public funding to enhance external relations, R&D outsourcing of firms, and the role of human resources in R&D and innovation.

Research Experts’ Role in Knowledge Development and Exchange in Formal Research Cooperation

The literature on ‘distributed’ and ‘open’ innovation emphasizes the need for enterprises to exchange external knowledge in order to perform R&D and to innovate. This paper focuses on research partnerships as a way to do so. More particularly, a distinction is made between the development and the exchange of in house knowledge in formal research cooperation agreements. Learning efficiency in absorbing external knowledge, reduction of outgoing spillovers, and access to tacit knowledge and know-how are main drivers for research cooperation and are largely related to capabilities in terms of internal R&D employment. Using micro-level data provided by the OECD business R&D survey for Belgium, insights are offered in the way R&D personnel qualifications and occupations are related to knowledge generation in R&D collaboration. More specifically, it is demonstrated that both the occupational positions and the level of education of R&D managers and researchers are positively related to knowledge development and knowledge exchange in formal R&D collaboration agreements. Moreover, in terms of absorptive capacity it is found that patent registration and innovative outputs are positively related to the propensity to engage in knowledge development in R&D collaboration, but not to the engagement of knowledge exchange in R&D collaboration